ShriNavaratnam

Sentiment was also lifted by the safe-passage of the U.S. healthcare legislation in the House of Representatives late Sunday.

"Asian equity markets were unduly concerned about the U.S. health care bill yesterday," said BBY Senior Institutional Trader Peter Copeland in Sydney. "There was some concern that the U.S. market would take a dim view of the reforms, but the reverse happened, so we have just unwound yesterday's fall."

Japan's Nikkei 225 was down 0.2% as the market resumed trade following a holiday Monday. Australia's S&P/ASX 200 was up 0.7%, South Korea's Kospi Composite was up 0.6% and New Zealand's NZX-50 was 0.2% higher. Dow Jones Industrial Average futures were five points higher in screen trade.

In Australia, the market was rising on gains in materials, banks and utilities plays.

BBY's Copeland said a lot of investors who recently positioned themselves for a double dip in the market were likely to unwind some of that positioning as Wall Street remained resilient and most of the recent U.S. economic data were better than expected.

Arrow Energy was down 1.4% at A$5.03 after investors gave up hope that Royal Dutch Shell and PetroChina Co. will further increase their offer to buy the bulk of Arrow's Australian assets. The original bid of A$4.45 per share was increased to A$4.70 per share.

Exporters were weighing on the Japanese market, as an uptick in the yen against the euro and the U.S. dollar on Monday damped demand. The yen, however, was losing some ground against the euro and the dollar in early trade.

"Concerns about Greece's debt problems are persistent, and exporters with relatively high presence in Europe are underperforming," said Yutaka Miura, senior technical analyst at Mizuho Securities.

Mazda Motor was down 0.8%, Canon gave up 0.7% and Nikon was off 1.3%.

Toshiba rose 4.0% after the Nikkei reported that the company and Microsoft Chairman Bill Gates will jointly lead an effort to develop a next-generation nuclear reactor that can operate for up to 100 years without refueling.

Technology stocks were helping the Korean market trade higher.

Taurus Investment & Securities' J.J. Park said expectations for an increase in demand for technology products in the U.S. were underpinning the sector.

New Zealand shares were up modestly in subdued trade, helped by some bargain hunting in bellwether Telecom. The stock was up 0.8% following recent sharp losses on concerns about its outlook after the company said last week the government's rural broadband plan would hurt its earnings if implemented in its current form.

New Zealand Refining rose 7.7% as investors remained upbeat about improving refining margins. Fisher & Paykel Healthcare, which has a sizable presence in the U.S., rose 1.2% following the passage of the U.S. healthcare reform bill.

In foreign exchange markets, the euro was holding steady with traders continuing to focus on a resolution to Greece's fiscal problems. The common currency reversed earlier losses on Monday after European Central Bank President Jean Claude Trichet said the ECB wouldn't oppose bilateral aid from other members of the euro area if it were tied to strict conditions. The euro was at $1.3548 against the U.S. dollar, from $1.3554 in late New York trade Monday and at Y122.35 from Y122.21. The dollar was at Y90.30 from Y90.15.

Most traders expect the euro to remain under pressure due to the ongoing uncertainty over the Greek debt issue. "The euro's near term outlook is bleak. Market participants want euro supportive factors including any specific measures to prevent Greece's default, but those steps look difficult to implement in reality," said Gaitame.com chief analyst Daisaku Ueno.

Japanese government bonds were up on gains in U.S. Treasurys Monday. The lead 10-year contract was up 0.12 at 138.75 points.

Spot gold was at $1,103.65 per troy ounce, up $1.05 from the New York close after falling below the $1,100 support in Monday's trade. "Previous declines below $1,100 triggered emerging market gold demand; (emerging market) buying would likely stabilize prices, but possibly not until Greek fiscal debt concerns fade," said HSBC analyst James Steel.

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